Malaysia’s exports to China: does diplomatic relationship matter?

Hong, Meenchee, Sun, Sizhong, Beg, Rabiul, and Zhou, Zhang-Yue (2020) Malaysia’s exports to China: does diplomatic relationship matter? Economic Papers, 39 (1). pp. 72-88.

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Institutional arrangements can play an important role in fostering trade between countries. It can help to boost export from one country to another and ease the penetration of new products to the market of the importing country. The institutional aspects, however, have been largely overlooked in trade studies for developing economies, especially for Malaysia. This study focuses on examining the importance of diplomatic relationships in fostering Malaysia–China’s trade. Through consumer utility maximisation, diplomatic relationships as well as other institutional aspects such as halal-related variables are incorporated into an augmented gravity model. The findings suggest that building and improving diplomatic ties tend to boost trade between countries.

Item ID: 62949
Item Type: Article (Research - C1)
ISSN: 1759-3441
Keywords: export, diplomacy, institution, gravity model, Malaysia, China
Copyright Information: © 2019 The Economic Society of Australia
Date Deposited: 07 Aug 2020 00:36
FoR Codes: 44 HUMAN SOCIETY > 4404 Development studies > 440407 Socio-economic development @ 35%
38 ECONOMICS > 3801 Applied economics > 380110 International economics @ 30%
38 ECONOMICS > 3802 Econometrics > 380205 Time-series analysis @ 35%
SEO Codes: 91 ECONOMIC FRAMEWORK > 9103 International Trade > 910399 International Trade not elsewhere classified @ 60%
95 CULTURAL UNDERSTANDING > 9504 Religion and Ethics > 950404 Religion and Society @ 40%
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